Which of the following is/are of a capital nature?
(1) Purchase of a truck (2) Cost of repair
(3) Wages paid for installation of machinery (4) Road tax paid

1 and 3

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2 and 3

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3 and 4

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1 and 4

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Solution

The correct option is A 1 and 3
Capital expenditure or capital expense (capex) is the money a company spends to buy, maintain, or improve its fixed assets, such as buildings, vehicles, equipment, or land.
From the above definition it is concluded that :
Purchase of truck and Wages paid for installation of machinery, both these expenses are of capital nature.

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Similar questions

Q. State with reasons whether the following are Capital or Revenue Expenses:
(i) Excise duty paid on purchase of new machine.
(ii) Wages paid to install a machine.
(iii) Repairs carried out on existing car.
(iv) Office block of building repainted for ₹ 50,000.
(v) Paid telephone bill ₹ 2,500.

Q. State with reasons whether the following are capital or revenue expenditures:
(i) A new machine is purchased for ₹ 60,000, ₹ 800 were spent on its carriage and ₹ 1,500 were paid as wages for its installation.
(ii) A sum of ₹ 10,000 was spent on painting the new factory.
(iii) ₹ 5,000 paid for the erection of a new machine.
(iv) ₹ 2,000 were spent on repairs before using a second hand generator purchased recently.
(v) ₹ 1,500 were spent on the repair of a machinery.
(vi) ₹ 10,000 was paid as brokerage on issue of shares and other expenses of issue were ₹ 25,000.

Q. State with reasons whether the following are capital or revenue expenditures:
(i) A new machine is purchased for ₹ 60,000, ₹ 800 were spent on its carriage and ₹ 1,500 were paid as wages for its installation.
(ii) A sum of ₹ 40,000 was spent on painting the new factory.
(iii) ₹ 6,000 were paid for annual insurance premium.
(iv) ₹ 20,000 were spent on repairs before using a second hand generator purchased recently.
(v) ₹ 5,000 were spent on the repair of a machinery.
(vi) ₹ 50,000 were spent for airconditioning of the office of the manager.

Rectify the following errors:-

1) Purchase of Building was passed through purchases Book as Rs 65,000.
2) Wages paid for construction of building Rs 15,000 was wrongly debited to wages account.
3) Expense of installation of Machinery was debited to installation charges account Rs 55,000.
4) Brokerage paid Rs 600 for purchase of investment were debited to brokerage account.
5) Old Motor car purchased was debited to repairs account Rs 7,000.
6) Materials purchased for construction of Building was debited to purchases account Rs 9,000.

Following transactions have occurred. Find the total expenditure to be carried to Repair expenditure.

`- Rs 500 paid for installation of machinery was debited to wages account

`- Rs 5000 paid for extension of building was debited to repairs account

`- Rs 2000 paid for repair of an existing machine was debited to machinery account

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Which of the following is/are of a capital nature?(1) Purchase of a truck (2) Cost of repair(3) Wages paid for installation of machinery (4) Road tax paid

Which of the following is/are of a capital nature?
(1) Purchase of a truck (2) Cost of repair
(3) Wages paid for installation of machinery (4) Road tax paid